1. Financial Results Q4 2013
CEO Jouko Karvinen and CFO Seppo Parvi
5 February 2014

2. It should be noted that certain statements herein which are not historical facts, including, without
limitation those regarding expectations for market growth and developments; expectations for growth
and profitability; and statements preceded by “believes”, “expects”, “anticipates”, “foresees”, or similar
expressions, are forward-looking statements within the meaning of the United States Private Securities
Litigation Reform Act of 1995. Since these statements are based on current plans. estimates and
projections, they involve risks and uncertainties which may cause actual results to materially differ from
those expressed in such forward-looking statements. Such factors include, but are not limited to: (1)
operating factors such as continued success of manufacturing activities and the achievement of
efficiencies therein, continued success of product development, acceptance of new products or services
by the Group’s targeted customers, success of the existing and future collaboration arrangements,
changes in business strategy or development plans or targets, changes in the degree of protection
created by the Group’s patents and other intellectual property rights, the availability of capital on
acceptable terms; (2) industry conditions, such as strength of product demand, intensity of competition,
prevailing and future global market prices for the Group’s products and the pricing pressures thereto.
price fluctuations in raw materials, financial condition of the customers and the competitors of the
Group, the potential introduction of competing products and technologies by competitors; and (3)
general economic conditions, such as rates of economic growth in the Group’s principal geographic
markets or fluctuations in exchange and interest rates.
Stora Enso Q4 2013 Financial Results
5 February 2014
2

3. Strong cash flow, dividend proposal EUR 0.30
Q4 2013
•
Operational EBIT EUR 152 million Q4, margin 5.8%
•
Cash flow from Operations EUR 470 million, after investing activities EUR 310
million
•
New Ostrołęka containerboard machine reached its targeted profitability of
EBITDA margin 20% by the end of 2013
•
Net debt/Operational EBITDA LTM 2.3x, net debt reduced by EUR 320 million
year-on-year
•
Net Non-recurring items EUR 392 million
Stora Enso Q4 2013 Financial Results
5 February 2014
3

4. Strong cash flow maintained in 2013 due to operative
working capital reduction
350
27.0 %
300
25.0 %
23.0 %
250
21.0 %
200
19.0 %
150
17.0 %
100
15.0 %
Cash flow from operations, 4Q rolling
OWC%, 4 Q rolling
*Operative working capital = trade receivables + inventories – trade payables
Stora Enso Q4 2013 Financial Results
5 February 2014
4

5. Fixed cost decreased by EUR 60 million in 2013
compared to 2012
Fixed cost 4 quarter rolling average
700
695
690
685
680
675
670
665
660
655
650
11Q1
11Q2
11Q3
11Q4
12Q1
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
4 Quarter rolling average
Stora Enso Q4 2013 Financial Results
5 February 2014
5

6. Thiele Kaolin divestment
•
Capital gain of EUR 37 million
recorded as NRI to Q1 2014
•
Proceeds EUR 56 million paid fully in
cash
Stora Enso Q4 2013 Financial Results
5 February 2014
6

7. Printing and Reading
2013
MEUR
•
Weak earnings
600
•
Continued strong cash generation
EUR 382 million
500
400
•
Three machines closed
•
Further capacity restructuring
plans in early 2014
300
200
100
0
2011
CF from Operations
Stora Enso Q4 2013 Financial Results
5 February 2014
2012
2013
CF after Capex
7

8. Biomaterials
2013
•
•
•
Softwood pulp prices increased in
2013
18%
16%
14%
Hardwood pulp prices stable
towards the end of the year
Montes del Plata start-up during
first months of 2014
12%
10%
8%
6%
4%
•
Biorefinery investment to Sunila
2%
0%
2011
ROOC - %
Stora Enso Q4 2013 Financial Results
5 February 2014
2012
2013
ROOC - % excl Str. Projects
8

9. Building and Living
2013
MEUR
•
Sales price and mix improved
80
70
•
•
Fixed costs savings started early
60
50
Building Solutions growing rapidly
in Finland
40
30
•
Stora Enso is working with
feasibility study to start the
production of CLT in Finland
20
10
0
2011
2012
2013
Op. EBIT
Stora Enso Q4 2013 Financial Results
5 February 2014
9

10. Renewable Packaging
2013
•
3-5% demand growth continues
MEUR
350
•
Record operational EBIT and
strong cash flow
300
250
•
Ostrołęka in full swing
•
Inpac growing in fast moving
consumer goods by 30%
•
Guangxi project in implementation
200
150
100
50
0
•
2011
Bulleh Shah started LPB
deliveries
Stora Enso Q4 2013 Financial Results
2012
2013
Op. EBIT
5 February 2014
10

12. Summary financials
Q4 2013
Change %
Change %
EUR million
Q4/13
Q3/13
Q4/12
Sales
2 604
2 556
2 727
-4.5
1.9
Operational EBITDA
246
311
276
-10.9
-20.9
Operational EBITDA, %
9.4
12.2
10.1
-6.9
-23.0
Operational EBIT
152
184
158
-3.8
-17.4
Operational EBIT margin, %
5.8
7.2
5.8
-
-19.4
110
0.15
-0.18
7.6
125
0.13
0.11
9.0
83
0.11
0.33
7.3
32.5
36.4
-154.5
4.1
-12.0
15.4
-263.6
-15.6
9.1
10.4
8.4
8.3
-12.5
470
331
473
-0.6
42.0
2.3
2.5
2.5
-8.0
-8.0
Profit before tax excl. NRI
EPS excl. NRI, EUR
EPS (basic), EUR
Operational ROCE, %
Operational ROCE, % excl. transformation
investments
Cash Flow from Operations
Net debt/last 12 months’ operational EBITDA
Stora Enso Q4 2013 Financial Results
5 February 2014
Q4 13 / Q4 12 Q4 13 / Q3 13
12

13. Transformation continues
Group operational EBIT 2012 vs 2013 in EUR million
EUR
million
EUR
million
630
2012
578
Printing Biomaterials Building Renewable
and
and Living Packaging
Reading
Stora Enso Q4 2013 Financial Results
5 February 2014
Other
2013
13

14. Change in Net Debt from 2012 to 2013
76
424
66
377
237
219
76
2 434
2 757
1 044
Net debt Operational
Dec 2012
EBITDA
Change in
Cash
working restructuring
capital
payments
CAPEX
Stora Enso Q4 2013 Financial Results
EAI
injections
5 February 2014
Dividend
Tax and net
financials
paid
Other
Net debt
Dec 2013
14

15. Capex and Equity Injections
EUR million
Actual 2013
Forecast 2014*
Capital expenditure
425
820-900
Equity injections
66
30
Total
491
850-930
Depreciation
564
550-580
* Capital expenditure includes approximately EUR 300 million for the project in Guangxi, China and approximately EUR 150
million for Montes del Plata Pulp Mill. As of 2014 Stora Enso will consolidate Veracel and Montes del Plata line-by-line in
accordance with IFRS11.
Stora Enso Q4 2013 Financial Results
5 February 2014
15

16. Guidance
Compared to Q4 2013
• Sales expected to be similar
• Operational EBIT from similar to
somewhat higher
• Pricing improving
• Fixed cost decreasing
• Renewable Packaging affected by
Guangxi project and Skoghall Mill
boiler incident
Stora Enso Q4 2013 Financial Results
5 February 2014
16

17. Strategy in action 2013
EUR 1.25 billion cash flow, fixed costs down and a lot more to come
• Ostrołęka
•
•
•
•
at 20% EBITDA Q4/13
coming real soon
growing 30%+ in focused segments
world class LPB delivered
accelerating growth
Montes del Plata
Inpac Packaging
Bulleh Shah
Building Solutions
• Guangxi Packaging
• Sunila Biorefinery
implementation started
implementation started
Nothing is ever good enough
- endless focus on productivity, working capital, capacity management &
cash generation, never stop
Stora Enso Q4 2013 Financial Results
5 February 2014
17

18. Stora Enso Q4 2013 Financial Results
5 February 2014
18

19. Operational EBIT by segments
Change %
EUR million
Printing and Reading
% of sales
Biomaterials
% of sales
Building and Living
% of sales
Renewable Packaging
% of sales
Other
% of sales
Q4/13
Q3/13
36
3.4
24
9.3
19
4.1
73
9.3
-
Stora Enso Q4 2013 Financial Results
13
1.2
17
7.0
24
5.2
100
12.1
30
4.9
5 February 2014
Q4/12
59
4.9
28
10.9
7
1.5
55
6.9
9
1.3
Change %
Q4 13 / Q4 12 Q4 13 / Q3 13
-39.0
-30.6
-14.3
-14.7
171.4
173.3
32.7
34.8
-100.0
-100.0
176.9
183.3
41.2
32.9
-20.8
-21.2
-27.0
-23.1
-100.0
-100.0
19

20. Solid cash flow across businesses in Q4 2013
Cash flow from Operations
Cash flow after investments
200
180
160
EUR million
140
120
100
80
60
40
20
0
Printing and
Reading
Biomaterials
Stora Enso Q4 2013 Financial Results
Building and Living
5 February 2014
Renewable
Packaging
20

21. All businesses contributed to cash flow generation in
2013
Cash flow from Operations
Cash flow after investments
600
EUR million
500
400
300
200
100
0
Printing and
Reading
Biomaterials
Stora Enso Q4 2013 Financial Results
Building and Living
5 February 2014
Renewable
Packaging
21

22. Paper demand decline continued in Europe
4%
38000
2%
37000
0%
36000
-2%
35000
-4%
34000
-6%
33000
-8%
32000
-10%
Y-o-Y change %
6%
39000
Y-o-Y Paper
31000
-12%
Annualized Paper
SA = seasonally adjusted
Oct-13
Jul-13
Apr-13
Jan-13
Oct-12
Jul-12
Apr-12
Jan-12
Oct-11
Jul-11
-14%
Apr-11
30000
Jan-11
Annualized demand [kt/a]
40000
Source: Euro-Graph
Stora Enso Q4 2013 Financial Results
5 February 2014
22

23. Despite lower EBIT cash flow remained strong in 2013
Active working capital management
Cash flow from operations
1300
1250
EUR million
1200
1150
1100
1050
1000
950
900
850
800
2009
2010
Stora Enso Q4 2013 Financial Results
2011
5 February 2014
2012
2013
23

24. Fixed costs to sales
110%
108%
106%
104%
102%
100%
98%
96%
94%
92%
90%
88%
11Q1
11Q2
11Q3
11Q4
12Q1
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
Fixed costs to Sales 11Q1 = 100
Stora Enso Q4 2013 Financial Results
5 February 2014
24

25. Balance Sheet strength
Q1 2011 – Q4 2013
Net Debt
Net Debt/Operational EBITDA*
3 500
3.0
3 000
2.7
EUR million
2.7
2.5
2 500
2 000
2.8
2.3
1.8
1.9
2.0
2.5
2.7
2.5
2.3
2.1
2.0
1.5
1 500
1.0
1 000
500
0.5
0
0.0
11Q1 11Q2 11Q3 11Q4 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4
*Last twelve months’ operational EBITDA
Stora Enso Q4 2013 Financial Results
5 February 2014
25

26. Permanent pulp, paper and board capacity reductions
since 2006
Mill
Date
Grade
Capacity reduction, t
Corbehem PM 3 and PM 4
Jun 2006
LWC
250 000
Varkaus PM 1
End 2006
WFC
95 000
Berghuizer Mill
Oct 2007
WFU
235 000
Reisholz Mill
End 2007
SC
215 000
Summa Mill
Jan 2008
Newsprint, uncoated mag, book paper
415 000
Anjala Mill PM1
Feb 2008
Coated magazine paper
155 000
Baienfurt Mill
End 2008
FBB
190 000
Kabel Mill PM 3
End 2008
Coated magazine
140 000
Kemijärvi Pulp Mill
April 2008
Long-fibre (SW) pulp
250 000
Norrsundet Pulp Mill
Dec 2008
Long-fibre (SW), pulp
300 000
Varkaus Mill coreboard machine
Dec 2008
Coreboard
100 000
Imatra PM 8
Mar 2010
WFU
210 000
Varkaus PM 2 and PM 4
Sep 2010
Newsprint, directory paper
290 000
Maxau PM 7
Nov 2010
Newsprint
195 000
Hylte PM1
Dec 2012
Newsprint
180 000
Ostroleka PM2
Jan 2013
Containerboard
Hylte PM2
May 2013
Newsprint
205 000
Kvarnsveden PM11
May 2013
Newsprint
270 000
Total
85 000
3 780 000
Stora Enso Q4 2013 Financial Results
5 February 2014
26

27. Permanent sawn wood capacity reductions
since 2006
Capacity reduction, m3
Mill
Date
Veitsiluoto Sawmill
2006
100 000
Honkalahti Sawmill
2006
90 000
Sauga Sawmill
Jun 2007
130 000
Sollenau Sawmill
2007
110 000
Näpi Sawmill
2007-2008
100 000
Kotka Sawmill
2007-2008
70 000
Paikuse Sawmill
End 2008
220 000
Zdirec Sawmill
2008
120 000
Ybbs Sawmill
2008 & Jun 2009
200 000
Kitee Sawmill
2008 & Jun 2009
130 000
Varkaus Sawmill
Jun 2009
60 000
Tolkkinen Sawmill
End 2009
260 000
Kopparfors Sawmill
End 2011
310 000
Total
1 900 000
Stora Enso Q4 2013 Financial Results
5 February 2014
27

28. Net Financial Items
EUR million
Change % Change %
Q413/Q412 Q413/Q313
Q4/2013
Q3/2013
Q4/2012
-48
-52
-47
-2
8
9
7
-1
n/m
29
-25
-11
-2
n/m
-127
-
3
3
-8
-4
-9
Fair valuation of long-term debt
1
-
-
NewPage lease provision
-
-
11
Pension costs (IAS 19R)
-4
-4
-3
-14
-6
-4
-64
-56
-50
-28
-14
Net interest expense
Foreign exchange gains and losses
Other financial items. of which
PIK notes
Fair valuation of interest rate derivatives*
Other items
Total net financial items
*Not hedge accounted interest rate derivatives.
Stora Enso Q4 2013 Financial Results
5 February 2014
28

29. Transaction risk and hedges
as at 31 December 2013
USD
SEK
GBP
950
-780
530
Transaction hedges as at 31 Dec 2013
-450
450
-260
Hedging percentage as at 31 Dec 2013 for the next 12 months
47%
58%
49%
EUR million
Estimated annual net operating cash flow exposure
Operational EBIT: Currency strengthening of + 10 % EUR million
USD
95
SEK
-78
GBP
53
The sensitivity is based on estimated next 12 months net operating cash flow. The
calculation does not take into account currency hedges, and assumes no changes occur
other than a single currency exchange rate movement. Weakening would have the
opposite impact.
Stora Enso Q4 2013 Financial Results
5 February 2014
29

30. Curtailments
of capacity
Paper and Board
Wood Products
20
18
16
% of the capacity
14
12
10
8
6
4
2
0
Q111
Q211
Q311
Q411
Q112
Q212
Stora Enso Q4 2013 Financial Results
Q312
5 February 2014
Q412
Q113
Q213
Q313
Q413
30

31. Softwood pulp prices
Stora Enso’s market pulp is softwood
1 050
950
Bleached softwood kraft
pulp
750
Bleached hardwood kraft
pulp
650
550
450
07Q1
07Q2
07Q3
07Q4
08Q1
08Q2
08Q3
08Q4
09Q1
09Q2
09Q3
09Q4
10Q1
10Q2
10Q3
10Q4
11Q1
11Q2
11Q3
11Q4
12Q1
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
USD/tonne
850
Source: FOEX
Stora Enso Q4 2013 Financial Results
5 February 2014
31

32. Pulp wood and saw log prices
Wood prices in Finland
Pulpwood, Pine
Sawlogs, Pine
80
70
50
40
30
20
13Q4
13Q3
13Q2
13Q1
12Q4
12Q3
12Q2
12Q1
11Q4
11Q3
11Q2
11Q1
10Q4
10Q3
10Q2
10Q1
09Q4
09Q3
09Q2
09Q1
08Q4
08Q3
08Q2
08Q1
07Q4
07Q3
07Q2
07Q1
06Q4
06Q3
0
06Q2
10
06Q1
EUR/m3
60
Source: METLA
Stora Enso Q4 2013 Financial Results
5 February 2014
32

33. Paper for Recycling prices
Mixed
OCC
De-inking
200
120
80
40
0
07Q1
07Q2
07Q3
07Q4
08Q1
08Q2
08Q3
08Q4
09Q1
09Q2
09Q3
09Q4
10Q1
10Q2
10Q3
10Q4
11Q1
11Q2
11Q3
11Q4
12Q1
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
EUR/tonne
160
German RCP price development. free delivered
Source: Verband Deutscher Papierfabriken/Stora Enso
Stora Enso Q4 2013 Financial Results
5 February 2014
33

34. Maturity profile Q4 2013
€ million
Bonds
Other loans / liabilities
Commercial paper
1 000
900
800
€ 500m 5.0% 2018
SEK 2.2 bn S+3.9% 2017
SEK 500m 5.75% 2017
700
600
€ 500m 5.5% 2019
500
400
300
200
100
0
2014
2015
2016
2017
2018
2019
2020
2021-2035
2036
Revolving Credit Facility € 700 million matures in January 2015 and is fully undrawn
Stora Enso Q4 2013 Financial Results
5 February 2014
34

35. Energy balance* Q4 2013
Impact** on operating profit from
10% change in:
EUR million p.a.
Electricity market price
~1
Fossil fuel price
~12
**) Remaining impact on non-hedged volume
*) Pulp. paper and board mills. Europe and overseas
Stora Enso Q4 2013 Financial Results
5 February 2014
35

36. Stora Enso Electricity procurement* Q4 2013
*) Pulp. paper and board mills. Europe and overseas
Stora Enso Q4 2013 Financial Results
5 February 2014
36